(1) Confirmation of entry value.
Under the historical cost measurement mode, the current accounting system stipulates that the recorded value of an asset is its historical cost, that is, the actual capital consumption when the asset is acquired, which cannot be changed once it is determined. This is not the case when measured at fair value, because fair value is based on the evaluation of market information. With the change of the market, the fair value is constantly changing. Accordingly, the recorded value of assets cannot be fixed and needs to be adjusted according to the change of fair value. Generally speaking, fair value can be greater than historical cost or less than historical cost, depending on the appreciation or impairment of assets.
(2) Determination of amortization object of assets.
Under the historical cost measurement mode, the amortization object of assets is undoubtedly its historical cost, or average amortization, or accelerated amortization. When measured at fair value, there are two amortization objects: fair value and actual cost. Many scholars believe that the object of amortization should be its fair value. But the author thinks that the object of asset amortization should be its actual cost. Because fair value is not the actual price paid by the enterprise to obtain the asset, if amortization is included in the subjects such as "management expenses" and "manufacturing expenses", when the asset increases in value, it will inflate the expenses; When assets depreciate, expenses will be underestimated, resulting in false expenses. Fair value is essentially similar to an objective evaluation value, which does not conform to the accounting content of expense subjects, so the object of asset amortization should be its actual cost, not its fair value. Because of this, when measuring at fair value, accounting information should reflect not only the fair value of assets, but also the actual cost of assets, so the double-account reflection method should be adopted.
(3) the form of accounting reflection.
Under the historical cost measurement mode, only a single account is needed to reflect the actual cost of assets. When measured at fair value, because the amortization object of assets is still its actual cost, accounting should reflect both its fair value and its actual cost, so it is necessary to set up double-entry accounts. In the accounting statements, besides the accounts reflecting the actual cost of assets, there must also be differential accounts reflecting the fair value and actual cost. If the fair value is greater than the actual cost, both accounts are debit balances; When the fair value is less than the actual cost, the actual cost account is the debit balance and the difference account is the credit balance. Considering the principle of prudence, the current chart of accounts only sets impairment reserve accounts for asset accounts. It should be said that this is only a transitional form. When the fair value can be accurately grasped, it should not only reflect the impairment of assets, but also reflect the appreciation of assets, such as goodwill and land use rights, which can be greatly increased.